Week 1 Discussion

1/12/2021 South University

https://myclasses.southuniversity.edu/d2l/le/content/73907/viewContent/3255552/View 1/2

Collaborative Commerce with CPFR

The Internet has helped organizations become more �exible by coordinating and collaborating with their suppliers and customers. IT provides managers tools for precise planning, forecasting, and monitoring business operations. SCM links and coordinates the activities of purchasing, storing, and moving products. Collaborative commerce refers to the use of digital technology to collaboratively design, develop, build, move, and manage products through their life cycles.

Enterprise software organizations such as MarketMAX, Peoplesoft, and Manugistics have developed SCM software that uses CPFR to enable multiple partners to work together on forecasting demand. VF Corporation, an apparel manufacturer of Lee Jeans and Wrangler Jeans in Greensboro, South Carolina uses Manugistics software to coordinate production planning with their suppliers. The system enables the transmission of production plans over the Web, and highlights any con�icts in VF’s production schedule and its suppliers’ delivery schedule.

Let us understand how CPFR works for an organization.

VF uses MarketMAX’s DISP planning software to support its collaborative, forecasting, and replenishment processes. This software works with large retailers such as ShopKo, Wal-Mart, JC Penney’s, and Sears to share their sales forecasts with VF’s demand forecast. When the forecasts match the results are fed into VF’s replenishment system so that inventory levels are set and the required styles, sizes, and quantities are restocked on shelves at the right time to maximize sell- through. Wal-Mart works with VF by taking point of sales (POS) data from Wal-Mart’s checkout counters and transmits it directly to VF’s CPFR system. VF continuously revises its Wal-Mart forecast with Wal-Mart’s real-time POS data. This Ef�cient Customer Response system is an excellent example of how one organization’s value chain works with the industry chain. The result is that products are

1/12/2021 South University

https://myclasses.southuniversity.edu/d2l/le/content/73907/viewContent/3255552/View 2/2

replenished within 24 hours instead of 3 weeks. You learned the importance of CPFR in collaborative commerce. Now let’s discuss how IS coordinates with various departments of an organization to perform its daily operations.